Elon Musk reportedly walked away from settlement with SEC

Jeannie Evans

Musk published his infamous tweet about taking Tesla private on August 7, briefly sending the company's stock price to a 52-week high before falling after it became clear the board had no information about his plans or funding sources and that the "funding secured" statement was unfounded.

Musk will have to explain to a court why he announced on social media that he had investors who would take Tesla private at a share price of $420.

"The SEC civil action may lead to Musk's exit from Tesla (either permanently or temporarily) and the Musk premium in the shares dissipating", wrote Johnson. The firm slashed Tesla's price target to $200 per share. He specifically said he would consider doing so at $420, adding that funding had already been secured.

"As demonstrated by the stock's reaction, investors believe the removal of Musk from Tesla would be negative for the prospects of the company, despite his recklessness in the go-private tweets".

According to the complaint, Musk met with representatives of a sovereign investment fund for 30 to 45 minutes on July 31 at Tesla's Fremont, California, factory.

The announcement caused the share price to spike and Musk later retracted his statement.

Tesla had disclosed on September 18 that the U.S. Department of Justice was investigating Musk's public statements on the go-private plan. That will be more of a challenge with Musk's future in doubt, Osbourne said.

"This unjustified action by the SEC leaves me deeply saddened and disappointed", Musk said in an emailed statement.

The complaint alleges that Musk's tweet harmed investors who bought Tesla stock after the tweet but before accurate information about the funding was made public.

"We are concerned that decreased confidence in Tesla on the part of investors may impact the company's ability to raise capital on amenable terms", Brinkman said.

In a statement, Tesla's board of directors said it remained "fully confident in Elon, his integrity, and his leadership of the company, which has resulted in the most successful USA auto company in over a century". The department of justice too is now looming into Musk's tweets and could bring a criminal case if it finds he deliberately misled investors. "Integrity is the most important value in my life and the facts will show I never compromised this in any way". In other words, Musk wouldn't take the settlement because that would imply that he did something wrong, and he doesn't think he did.

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